Nmims Bba CRM
Nmims Bba CRM
Management
By,
Mukti Prakash Behera
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Menti-based Discussion
GO TO:
www.menti.com
TYPE CODE:
3781 2002 2
Why CRM…?
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Interpreting Customer Centricity
Customer Relationship Management (CRM) is a strategy that
companies use to manage interactions with customers and
potential customers.
CUSTOMER
DELIGHT
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Why CRM…?
Transactional Approach Relationship Approach
Focuses on customer loyalty
Concentrates on single, “point of and long-term customer
sale” transactions. engagement.
Build emotion-centric
More emphasis on maximizing customer connections
the volume of individual sales.
To enable free word-of-mouth
promotion & feedback from
customers capable of
generating leads
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Traditional Marketing Vs CRM
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Meaning of CRM
CRM includes methodologies, software and usually Internet
capabilities that help an enterprise manage customer
relationships.
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SOCIAL CRM
A Social CRM is a software integrating with social media
channels, allowing organisations to :
Delight customers
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Social CRM
People who like your brand will sign up as fans creating
a venue for communication and networking
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Social CRM
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CRM TYPES
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STRATEGIC CRM
Focuses on the development of a customer-centric business
culture dedicated to winning and keeping customers by
creating and delivering value better than competitors.
Product-oriented Production-oriented
businesses businesses
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Case : Strategic CRM at HONDA
Honda manufactures and markets a successful range of motorcycle, power
equipment and marine products. The Honda brand has a reputation for quality,
technology and performance
Honda realized that consolidating and freeing up the flow of data could have a
huge positive impact on the effectiveness and efficiency of the business. Honda
developed a strategy themed Customers For Life, based on data integration and
a whole-of-customer view
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OPERATONAL CRM
Operational CRM automates customer-facing business processes. It enables
the marketing, selling and service functions to be automated and
integrated.
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ANALYTICAL CRM
Analytical CRM, is concerned with capturing, storing, extracting, integrating,
processing, interpreting, distributing, using and reporting customer-related
data to enhance both customer and company value.
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Marketing Automation
Integration of communication and offer strategies, and evaluation of
performance, requires a substantial amount of technology-aided coordination
across these channels.
EXAMPLE
When a credit-card customer calls a contact centre to enquire about the current
rate of interest, this can be taken as indication that the customer is comparing
alternatives, and may switch to a different provider.
This event may trigger an offer designed to retain the customer.
Such activities indicate potential changes in buyer behaviour,
initiating a marketing response. 17
Marketing Automation
Marketing Automation (MA) applies technology to marketing processes.
PHYSICAL
STORES
ONLINE ENGAGEMENT
CUSTOMERS
STORE
AMAZON
https://www.salesforce.com/in/form/conf/
demo-pardot/ 18
Sales Force Automation
Sales force automation (SFA) was the original form of operational CRM.
SFA systems are now widely adopted in business and are seen as “a competitive
imperative” that offers “competitive parity”.
LEAD GENERATION
LEAD QUALIFICATION
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Service Automation
Service automation is the application of technology to customer service
operations.
It helps manage the service operations, delivered through a call centre, contact
centre, field service, the Web or face-to-face interactions.
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Caselet
Empathetic banks are using technology such as voice
recognition, speech analytics and text analytics to understand
customers’ emotions at all touch points.
CUSTOMER DELIGHT
THROUGH VOICE
BIOMETRIC
AUTHENTICATION
DBS Contact Centre has also Enables callers to enjoy shorter call
incorporated Voice Biometrics. times.
Now, data about customers are as likely to be found in their Facebook or Twitter
activities and user-generated content posted to YouTube.
There is, therefore, a desire to integrate organization ‘owned’ data with that
generated socially to create a more comprehensive view of the customer
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Just a Thought…!!!
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MISUNDERSTANDINGS ABOUT CRM
CRM is an IT issue
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CRM
CRM is a core business strategy that integrates internal processes and
functions, and external networks, to create and deliver value to targeted
customers at a profit.
It is grounded on high-quality customer-related data and enabled by
information technology.
BEFORE NOW
companies have
Companies were grown larger,
located close to the they have become
markets they served more remote from
knew their the customers they
customers intimately serve.
Geographic &
cultural remoteness
Failure of Disney in
France 28
CRM CONSTITUENCIES
COMPANIES
Management consultants.
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COMMERCIAL CONTEXT OF CRM
AUTO
BANKS
MANUFACTURERS
TECHNOLOGY
CONSUMER GOODS
SOLUTIONS
MANUFACTURER
VENDORS
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GOALS OF CRM
Lasting Customer Relationship
Improved Efficiency
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IDIC MODEL
The IDIC model was developed by Don Peppers and Martha Rogers, of the
Peppers & Rogers Group.
The suggests that companies should take four actions in order to build
closer one-to-one relationships with customers:
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IDIC MODEL
https://www.projectguru.in/customer-
relationship-management/ 33
CRM VALUE CHAIN
Francis Buttle’s model consists of five primary stages and four supporting
conditions leading towards the end goal of enhanced customer
profitability.
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CRM VALUE CHAIN
Locate customers,
understand habits, interact
to develop relationship to
provide customer service
Managing SUPPLIERS,
CUSTOMERS, OWNERS,
PARTNERS, EMPLOYEES
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RELATIONSHIP FUNDAMENTALS
A relationship is composed of a series of interactive
episodes between dyadic parties over time.
Purchase
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RELATIONSHIP FUNDAMENTALS
There needs to be some emotional content to the
interaction.
This implies some type of affective connection,
attachment or bond.
A relationship exist only when the parties move from a state of
independence to dependence or interdependence.
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CHANGE IN RELATIONSHIP
AWARENESS
EXPLORATION
EXPANSION
COMMITMENT
DISSOLUTION
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TRUST
Trust is focused.
Although there may be a generalized sense of confidence and
security, these feelings are directed.
One party may trust the other party’s:
BENEVOLENCE
HONESTY
COMPETENCE
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COMMITMENT
Commitment is shown by ‘a partner believing that an ongoing
relationship with another is so important as to warrant
maximum effort to maintain it; that is, the committed party
believes the relationship is worth working on to ensure that it
endures indefinitely’.
Commitment arises from trust, shared values and the belief that partners
will be difficult to replace.
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WHY CUSTOMERS WANT COMMITMENT ?
The fundamental reason that companies want to build relationships with
customers is economic.
Companies generate better results when they manage their customer base
in order to identify, acquire, satisfy and retain profitable customers.
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EXAMPLE
Churn rates vary considerably.
Energy utilities supplying electricity and gas typically
have enjoyed very low churn levels because of their
monopoly positions.
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Caselet
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WHY COMPANIES WANT RELATIONSHIPS?
REDUCED MARKETING COSTS
As relationships deepen, trust & commitment between the parties is likely to grow.
Under these circumstances, revenue and profit streams from customers become
more secure.
One study, for example, shows that the average online clothing
customer spends 67% more, and grocery customers spend 23%
more, in months 31–36 of a relationship than in months 0–6.
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THE CUSTOMER JOURNEY
This is the result of
Prevent customers from the overall customer
2. AWARENESS abandoning the buying experience.
process and provide a
Message to be consistent great experience. 6. LOYALTY
across the channel.
Discrepancy will lead to 4. EXPERIENCE
customer confusion and
dissatisfaction.
5. ENGAGEMENT
1. NEED A two-way interaction leads
3. INTERACTION to a long-term relationship.
Create a need and align
product and services. Make conversations
Organisations should fruitful. Customers need to
make it a seamless feel important.
process. 48
Caselet
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CLV
A regular runner who regularly buys shoes from a store might be worth:
And a Mother who buys shoes for her kid might be worth:
(Source: www.shopify.com.ph)
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RELEVANCE OF CLV
Helps in measuring the Helps change the way we think about
financial impact marketing in terms of creating loyalty
of marketing campaigns. objectives.
INDICATIONS
•Average monthly transactions
•Average amount spent per transaction
•Average number of months your customers remain loyal
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THE VALUE OF KNOWING CLV
1. How much you can spend to acquire a similar customer and still
have a profitable relationship ?
2. What kinds of products customers with the highest CLV want ?
3. Which products have the highest profitability ?
4. Who your most profitable types of clients are ?
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IMPROVING CUSTOMER LIFETIME VALUE
Make it easy for customers to return items or get instant refund.
Set expectations regarding delivery dates, aiming to under-promise
and over-deliver.
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COMPONENTS OF CLV
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HOW CLV HELPS ?
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WHEN MIGHT COMPANIES NOT WANT RELATIONSHIPS WITH
CUSTOMERS?
LOSS OF CONTROL
EXIT COSTS
RESOURCE COMMITMENT
OPPURTUNITY COSTS
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Relationship in Marketing
It builds customers' loyalty for the long-term, rather than the short-
term marketing of a particular product or service.
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Prior Considerations for Relationship Marketing
Increase in Digital
Consumers
Relationship Identify the Customer Segment
likely to benefit from a RM Penetration of 4G and
Potential programme reduction in Smartphone
(Company)
price
Rise of Millennials
Not mandatory to be created for
Scope & Content of all customer segments. Capturing the Digital
Relationship Understand segment preference Lifestyle Ecosystem
& gain greater loyalty.
SBI Rewardz
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CSAT, CUSTOMER LOYALTY AND BUSINESS PERFORMANCE
Satisfaction increases
As customer satisfaction This in turn influences actual
because customer insight
rises, so does customer purchasing behaviour that
allows companies to
intention to repurchase and has an impact on business
understand their customers
loyalty. performance.
better.
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CUSTOMER SATISFACTION
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THE SERVICE RECOVERY PARADOX
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FACTORS CONTRIBUTING TO CUSTOMER SATISFACTION
Quality of Experience understand the customer personas and then cater to them
accordingly. By tracking all identity and behavioural
data, CRM helps understand the customer better.
Customer Service With better customer service, you can also cross-sell and
improve the CLV (customer lifetime value).
Better management of With CRM, businesses can have better visibility into
demands and can forecast sales accordingly.
purchases
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EXAMPLE
The Tesco Clubcard is Tesco’s way of rewarding its most loyal customers. For
every pound you spend online or in-store, you’ll get a point. These points,
when accumulated, can be traded in for Tesco Clubcard ‘vouchers’ (for
instance, 150 points gets you a £1.50 voucher).
Clubcard holders can also collect points at Tesco fuel stations, and by filling
out feedback surveys online.
What’s in it for Tesco? Returning customers that are invested in the brand, and
whose opinion Tesco can leverage to continue improving its growing basket of
offerings. 65
CUSTOMER LOYALTY
There are two major approaches to defining and measuring loyalty, one
based on behaviour, the other on attitude
Behavioural loyalty is measured by Attitudinal loyalty is measured by reference
reference to customer purchasing to attitude such as beliefs, feelings and
behaviour. purchasing intention. Those customers who
Loyalty is expressed in continued have a stronger preference for, involvement
patronage and buying in or commitment to a supplier are the more
loyal in attitudinal terms.
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EXAMPLE
If you’ve ever used iTunes (Apple’s online music streaming service), you’ll
have an Apple ID – and if you’ve ever used an Apple device, you’ll have had to
register it using an Apple ID, too.
These unique IDs synchronise across devices, remember music and film
selections, and provide personalised recommendations based on what’s
you've been watching or listening to.
For the user, it offers convenience. And for Apple, it’s a constantly updating
data set, telling the company exactly what its customers like and allowing for
effortless, targeted marketing.
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DBS – Creating SPARKS…!!!
2006 2019
“Living, Breathing Asia” “Live More, Bank Less”
The episodes humanized both Various Digital platforms used for the
bankers and banking. mini-series were YouTube, Facebook,
WeChat, and the DBS website.
OBJECTIVE – To reinvent
Marketing, to put customers The videos amassed over 250 million
back at the heart of what we do views & 24 million digital engagements
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https://www.dbs.com/livemore/sparks/index.html
MANAGING CUSTOMER LIFE CYCLE
CLC is a representation of the stages that customers go through
in their relationship with a company, as seen from the
company’s perspective.
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MANAGING CUSTOMER LIFE CYCLE
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SIGNIFICANCE OF CUSTOMER ACQUISITION
New customers have to Even in well-managed companies
be acquired to build there can be a significant level of
companies. customer attrition
The first task in managing Customer acquisition is always
the customer lifecycle is to the most important goal
acquire customers. during new product launches.
iD Fresh Food has invested in a lean manufacturing and supply process and
designed a unique distribution model that ensures freshness all along the
value chain, thus, refusing to rely on preservatives or chemicals to increase
shelf life.
It is this value chain that competitors have failed to replicate.
Their marketing campaign has a strong brand value that resonates with
millions and relies primarily on word of mouth. They have made conscious
efforts to hire young talent from remote villages and small towns and trained
them in manufacturing and sales, ensuring social responsibility.
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WHO IS A NEW CUSTOMER ?
A customer can be new in one of two senses:
1. New to the product category
2. New to the company
EXAMPLE
When a couple have their first child, they have a completely new set of needs
connected to the growth and nurturing of their child. This includes baby clothes,
food, toys, for example. As the child grows, the parents are faced with additional
new-to-category decisions, such as pre-school and elementary education.
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NEW TO COMPANY
NEW TO COMPANY
EXAMPLE
In developed economies, new players in grocery retail can only succeed by
winning customers from established operators.
They would not expect to convert those customers completely but to win a share
of their spending by offering better customer-perceived value in one or more of
important categories.
Once the customer is in-store, the retailer will use merchandising techniques such
as point-of-sale signs and displays to increase spending.
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NEW TO COMPANY
NEW TO COMPANY
EXAMPLE
New-to-category customers are sometimes expensive to recruit; sometimes they
are not. For example, when children leave home for university, banks compete
vigorously for their patronage.
On the other hand, supermarket retailers incur no direct costs in attracting these
same students to their local stores.
New-to-company customers can be very expensive to acquire, particularly if
they are strongly committed to their current supplier.
Commitment is reflected in a strong positive attitude to, or high levels of
investment in, the current supplier.
These both represent high switching costs. 77
PORTFOLIO PURCHASING
New customers can be difficult to identify in markets where customers
exhibit portfolio purchasing behaviours.
Customers buy on a portfolio basis when they buy from a choice set of
several more or less equivalent alternatives.
A customer who has not bought from one of the portfolio suppliers for a
matter of months or even years, may still regard the unchosen supplier as
part of the portfolio.
The supplier, on the other hand, may have a business rule that says: ‘If a
customer has not bought for three months, mail out a special offer’.
EXAMPLE
In the UK, many grocery customers shop at both Tesco and Sainsbury’s, two of the
major supermarket chains. These retailers do not simply compete to acquire and
retain customers. Instead they compete for a larger share of the customer’s
spending; that is, to grow share-of-wallet (SOW).
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THE CONVERSION MODEL
Jan Hofmeyr has developed The Conversion Model.
This contains a series of questions designed to assess whether a customer is
likely to switch.
The basic premise of the model is that customers who are not committed are
more likely to be available to switch to another provider.
Commitment, in turn, is a function of satisfaction with the brand or offer, the
attractiveness of alternatives and involvement in the brand or offer.
Involvement is low if the product or its usage context is relatively
unimportant to customers.
The Conversion Model allows customers to be segmented into four subsets
according to their level of commitment.
Entrenched Shallow
Average Convertible 79
THE CONVERSION MODEL
COMMITTED CUSTOMERS
UNCOMMITTED CUSTOMERS
have a lower commitment than average customers,
Shallow and some of them are already considering
alternatives.
Convertible are most likely to defect.
Salesforce helps Uber extract data from people engaging with its brand on
social media. With this system in place, Uber can reply to customer
complaints, and track all its interactions with the public from an intuitive
dashboard.
And, it runs its own loyalty program. Uber Rewards lets you earn points every
time you ride or eat with Uber, and redeem them across its increasing range of
services. It’s a great example of how Uber is incentivising customers to keep
relying on its brand,
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PROSPECTING
In CRM, it means searching for opportunities that might generate additional
value for the company.
B2B B2C
PROSPECTING PROSPECTING
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STAGES OF THE SALES PROSPECTING PROCESS
3
2
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B2B PROSPECTING
In the B2B environment, it is very often the task of marketers to generate
leads, and for the salesperson to follow up allocated leads.
The lead needs to be qualified so that sales and other resources are used
wisely to nurture a relationship with higher value prospects.
Once leads are qualified, companies need to decide the best channels for
initiating contact.
Direct-to-Customer Indirect
Channel Channel
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B2B PROSPECTING
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B2C PROSPECTING
In B2C contexts, the distribution of customer acquisition effort is different.
Advertising
Advertising is the creation and delivery of messages to targeted audiences
through the purchase of time or space in media owned by others.
https://www.youtube.com/watch?v=S_NlSSNGQvE
https://www.youtube.com/watch?v=GlzdVVthPUY
B2C PROSPECTING
Message Media
• Recall.
Print
How much of the ad can the sample
Web
recall?
Electronic
• Comprehension.
Does the sample understand the ad?
• Credibility.
Is the message believable?
• Feelings evoked.
How does the sample feel about the ad?
• Intention-to-buy.
How likely is it that the sample will buy?
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SALES PROMOTION
A sales promotion is a marketing strategy in which a business uses a
temporary campaign or offer to increase interest or demand in its
product or service.
BUZZ/WORD-OF-MOUTH
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USING SOCIAL MEDIA
It is in the B2C context that social media are more widely used.
Social media are Internet-based applications that allow the creation and
exchange of user-generated content.
Engaging, interactive content may motivate visitors to spend time on the page,
eventually leading to trial purchase.
Technology, in the form of social CRM applications, can be used to search social
media for references to competitors’ brands, and then join the conversation.
Established customers may become fans and benefit from receiving up-to-date
news feeds about the company and its products, passing on their enthusiasm
in ‘likes’ and ‘shares’ to friends in their social network, thereby generating new
customers for the brand. 91
USING SOCIAL MEDIA
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THE POWER OF INFLUENCERS
It is also suggested that encouraging influencers in social media to promote a
brand message into their social networks can be extremely powerful.
The objective is to identify & build relationships with influential people who
have a following of hundreds of thousands who in turn influence millions.
Influencer marketing is increasingly more popular among businesses these
days because traditional advertising has become less effective in
attracting leads and customers.
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BRAND INFLUENCERS/BRAND AMBASSADORS
Despite high levels of naturally occurring referral, companies may still choose
to develop a Customer Referral Scheme (CRS)/ Member-Get-Member (MGM)/
Recommend-A-Friend (RAF) schemes.
These work by inviting existing customers to recommend a friend and
rewarding the recommender with a gift.
Using data from an Internet firm that provided free Web hosting to
registered users during a 70-week-long observation period, they found
that customers acquired through WOM were themselves productive
at generating new customers through their own WOM.
Companies can compare the relative costs of customer acquisition per channel
before deciding how to spend their acquisition budget.
LEAD MANAGEMENT
CAMPAIGN MANAGEMENT
EVENT-BASED MARKETING
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OPERATIONAL CRM TOOLS THAT HELP CUSTOMER
ACQUISITION
LEAD MANAGEMENT
Lead Qualification Prioritize leads so that a company can invest its selling and
marketing resources where they generate the best returns.
Lead Allocation Processes ensure that leads are routed to the right
salesperson.
Lead Nurturing Ensure that leads receive levels of service & support that
help build trust and confidence prior to becoming buyers.
100
OPERATIONAL CRM TOOLS THAT HELP CUSTOMER
ACQUISITION
CAMPAIGN MANAGEMENT
Campaign management software is widely deployed in B2C environments and
increasingly in B2B environments for new customer acquisition.
Campaign managers design, execute and measure marketing campaigns with the
support of CRM technologies.
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OPERATIONAL CRM TOOLS THAT HELP CUSTOMER
ACQUISITION
EVENT-BASED MARKETING
The program is part of the bank’s broader effort to deepen its customer relationships.
Back in October, 2018, Bank of America launched an employee training curriculum called “Lifestage
Navigation” – a training program designed to focus on customers’ key life stages
(Source: https://www.medialogic.com/blog/financial-services-
marketing/customer-life-cycle-marketing-strategy/) 104
Good to Know…!!!
Whether it’s friendship or even a relationship with a Brand, all relationship move in 3 Stages…
Customer will KEEP or DISCARD AirPods can detect when they’re in your
Relationship Stages ear and not. Taking out one or both
AirPods from your ear pauses media
playback.
For two years, Apple's AirPods CURIOSITY They are smart enough to detect when
were a bizarre curiosity. They were you start talking & turns on beam-forming
clever, but they looked odd microphones. The BFM reduce actively
eliminate background noise and focus on
your speech.
Caselet
NEED FOR CUSTOMER RETENTION
107
CUSTOMER RETENTION
Customer retention refers to a company’s ability to turn customers
into repeat buyers & prevent them from switching to a competitor.
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SIGNIFICANCE OF CUSTOMER RETENTION
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BENEFITS OF CUSTOMER RETENTION
A customer retention strategy aims to keep a high proportion
of valuable customers by reducing customer defections (CHURN).
43.6%
112
HOW SILOS AFFECT RETENTION
PRODUCT SILOS
CHANNEL SILOS
FUNCTIONAL SILOS
113
Just a Thought…?
If you have 100 customers and lose 10 in the course
of a year, the defection rate is 10%.
What happens if the 10% of
But what if these customers
customers lost buy very little
account for 25% of your company’s
and/or have a high cost-to-serve?
sales? Is the true defection rate
25%?
It could be that the 10% contributes
less than 5% of sales and actually
Consideration of profit makes the
generates a negative profit; that is,
computation even more complex.
they cost more to serve than they
generate in margin.
If the 10% of customers that
defected produce 50% of your
The loss of some customers might
company’s profits, is the true
enhance the company’s profit
defection rate 50%?
performance.
114
MEASURES OF RETENTION
RAW CUSTOMER RETENTION RATE
This is the number of customers doing business with a firm at
the end of a trading period expressed as a percentage of those
who were active customers at the beginning of the period.
From Apex's point of view it has grown customer value by 50% (from
20 to 30 machines), which it might regard as an excellent achievement.
EXAMPLE
One bank, for example, lost 3% of its total balances when 5% of savings
account customers defected in a year.
But lost 24% of its total balances when 35% of customers reduced the
amounts deposited in their checking accounts.
The need to manage migration rather than defection is particularly
true when customers engage in portfolio purchasing by transacting
with more than one supplier. 117
MANAGING CUSTOMER RETENTION
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ECONOMICS OF CUSTOMER RETENTION
CUSTOMER REFERRALS.
PREMIUM PRICES
119
WHICH CUSTOMERS TO RETAIN ?
Customers who have greatest strategic value to the company are
prime candidates for your retention efforts.
The level of commitment between the customer and the company will
figure in the decision about which customers to retain.
120
MANAGING UNPROFITABLE CUSTOMERS
Sprint Nextel sent out letters to about 1,000 customers on June 29,
2007, to inform them that they had been summarily dismissed—but
the recipients were Sprint customers, not employees.
122
STRATEGIES FOR CUSTOMER RETENTION
124
KANO’S CUSOTMER DELIGHT MODEL
Some efforts to delight customers can go wrong.
LOYALTY SCHEMES
CUSTOMER CLUBS
SALES
PROMOTION
127
ADDING CUSTOMER PERCEOVED VALUE
LOYALTY SCHEMES
Loyalty schemes reward customers for their patronage/loyalty.
DEFINITION
A loyalty scheme is a customer management programme that offers delayed or
immediate incremental rewards to customers for their cumulative patronage.
Ideally, a Loyalty Program should be a competitive advantage & hard for competition
129to
replicate
Banking - Exemplifying Total Relationship Loyalty
130
https://www.loylty.com/awards.html
Caselet
131
CUSTOMER CLUBS
A customer club is a company-run membership organization that offers a
range of value-adding benefits exclusively to members.
https://www.harley-davidson.com/in/en/content/hog/membership-benefits.html132
SALES PROMOTION
In pack or On-pack Customers buy the product and receive a voucher entitling
Voucher them to a discount off one or more additional purchases.
Rebate or Cash-back Rebates are refunds that the customer receives after
purchase.
https://www.youtube.com/watch?
v=_JaWLC6BNgY
BONDING
Researchers have identified many different forms of bond between
customers and suppliers.
FINANCIAL BONDS
SOCIAL BONDS
STRUCTURAL BONDS
CUSTOMISATION BONDS
https://www.businessmanagementideas.com/service-marketing/customer-retention-
strategies/customer-retention-strategies-in-service-marketing-top-4-stages/17681
136
BONDING
FINANCIAL BONDS
The customer is tied to the firm through financial incentives; lower prices for greater
volume purchases or lower prices for customers who have been with the firm long
time.
In Airlines, Frequent Flyer programs provide financial incentives and car rental
companies do the same.
137
BONDING
SOCIAL BONDS
In this stage, strategies bind customers to the firm through more than financial
incentives.
Although price is still assumed to be important, here marketers build long-term
relationship through social and interpersonal as well financial bonds.
Customers are viewed as “clients” or “partners” not nameless faces, and becomes
individuals whose needs and wants the firm seeks to understand.
Social, interpersonal bonds are common among professional service providers
(lawyers, accountants, and teachers) and their clients as well as among personal
care providers (hair-dressers, counsellors, healthcare providers) and their clients.
138
BONDING
CUSTOMISATION BONDS
In this stage, strategies involve more than social ties and financial incentives.
Segment based customisation is the aim.
Two commonly used terms fit within the customisation bonds approach – mass
communication and customer intimacy.
Both of these strategies suggest that customer loyalty can be encouraged through
intimate knowledge of individual customers and through the development of “one-
to-one” solutions that fit the individual customers’ needs.
Caterpillar dealers are relied on not just to form strong personal commitments
to customers. They are also relied on to feed information back into the system
to help Caterpillar customise services to fit developing customer needs.
139
BUILDING CUSTOMER ENGAGEMENT
The final positive strategy for improving customer retention is to build customer
engagement.
Various studies have indicated that customer satisfaction is not enough to ensure
customer longevity.
COGNITIVE
ENGAGEMENT The cognitive and affective elements reflect
the experiences and feelings of customers.
AFFECTIVE
ENGAGEMENT
Customers have many and varied core beliefs such as sustainability, honesty, child
protection, independence, family-centredness and so on.
Where these values coincide with those of an organization, the customer may
develop a strong sense of emotional attachment to the organization.
144
Refer to Page 106, CRM, Francis Butle
THE POWER OF ENGAGED CUSTOMER
145
KPI’s – CUSTOMER RETENTION PROGRAMME
CRM practitioners may focus on a number of key performance indicators (KPIs) as
they measure the impact of their customer retention strategies and tactics, among
them the following:
146
THE ROLE OF RESEARCH
Companies can reduce levels of customer churn by researching a
number of questions:
1. Why are customers churning? (REASONS)
2. Are there any lead indicators of impending defection?
(CLUES)
3. What can be done to address the root causes? (ACTIONS)
147
CUSTOMER DEFECTION SIGNALS
The second question attempts to find out if customers give any early
warning signals of impending defection. If these were identified the
company could take pre-emptive action.
148
THE ROLE OF RESEARCH
Identified eight causes of switching behaviours in the service
industries :
PRICE INCONVENIENCE
CORE SERVICE
FAILURES
FAILED EMPLOYEE RESPONSE
CROSS-SELLING UP-SELLING
Integrated Customer
Channel Integration
Communication
Marketing Optimisation
151
STRATEGIES FOR TERMINATING CUSTOMER RELATIONSHIPS
A review of customer value might identify customers that are candidates for
dismissal, including customers who will never be profitable or who serve no
other useful strategic purpose.
154
STRATEGIES FOR SHEDDING UNPROFITABLE CUSTOMERS
155
STRATEGIES FOR SHEDDING UNPROFITABLE CUSTOMERS
HARDLINERS
Take an active & rigorous stance in terminating unprofitable
relationships, as they do a regular evaluation of their customer portfolio.
Factors such as a potential loss of trust in relationships or negative word-
of-mouth do not hinder their willingness to sack unprofitable customers.
APPEASERS
Take a more cautious approach concerning the termination of unprofitable
relationships, due to strategic considerations such as not playing customers
into competitors’ hands.
UNDECIDED
Are reluctant to terminate unprofitable relationships, mainly because
they fear the costs of attracting new customers.
156
STRATEGIC CRM
STRATEGIC CRM
157
CUSTOMER PORTFOLIO
A customer portfolio is the collection of mutually exclusive customer groups
that comprise a business’s entire customer base.
At one end, all customers are assigned to a single cluster and offered the
same value proposition; at the other, each customer is a unique ‘cluster-
of-one” and offered a unique value proposition.
https://brandlock.io/blog/5-types-of-online-shoppers-and-why-sites-fail-to-convert-them/
158
CUSTOMER VALUE PROPOSITION
161
BASIC DISCIPLINES FOR CPM
Market segmentation is the process of dividing up a market into more-or-less
homogenous subsets for which it is possible to create different value
propositions.
Market segmentation processes can be used during CPM for two main
purposes:
162
BASIC DISCIPLINES FOR CPM
The market segmentation process can be broken down into a
number of steps:
1. Identify the business you are in.
2. Identify relevant segmentation variables.
3. Analyze the market using these variables.
4. Assess the value of the market segments.
5. Select target market(s) to serve.
164
ANALYSING CONSUMER MARKETS
VARIABLES DEFINING CUSTOMER SEGMENTS
This allocates households to one of six categories (A, B, C1, C2, D and
E) depending upon the job of the head of household.
Media owners often use the JICNARS scale to profile their audiences.
165
ANALYSING CONSUMER MARKETS
VARIABLES DEFINING CUSTOMER SEGMENTS
The two other usage attributes :
VOLUME CONSUMED and SHARE OF CATEGORY SPEND are also
useful from a CRM perspective. Many companies classify their
customers according to the volume of business they produce.
166
ANALYSING CONSUMER MARKETS
168
DATA MINING FOR CLUSTERING
It is valuable when you are trying to find patterns or relationships
in large volumes of data, as found in B2C contexts such as retailing,
mobile telephony, financial services and Internet-based activities.
WHY ?
Customer portfolio management needs intelligent answers to questions such
as these:
1. How can we segment the market to identify potential customers?
2. How can we cluster our current customers?
3. Which customers offer the greatest potential for the future?
The company has 16 million “Clubcard” members in the UK. Not only does the
company have the demographic data that the customer provided on becoming
a club member, but also the customer’s transactional data. If ten million club
members use Tesco in a week and buy an average basket of 30 items, Tesco’s
database grows by 300 million pieces of data per week. This is certainly a huge
cost, but potentially a major benefit.
169
Caselet
170
BIVARIATE MODELS
Benson Shapiro and his colleagues developed a customer portfolio model that
incorporated the idea of cost-to-serve into the assessment of customer value.
In this model, customers are classified according to the price they pay and
the costs incurred by the company to acquire and serve them. Four classes
of customer are identified: carriage trade (often newly acquired customers
who are costly to serve but pay a relatively high price), passive customers,
aggressive customers and bargain basement customers. 171
BIVARIATE MODELS
Renato Fiocca improved this customer portfolio modelling by introducing a two-
step approach. At the first step customers are classified according to:
1. The strategic importance of the customer.
2. The difficulty of managing the relationship with the customer.
172
BIVARIATE MODELS
The difficulty of managing the customer relationship is related to:
1. Product characteristics such as novelty and complexity.
2. Account characteristics such as the customer’s needs and requirements,
customer’s buying behaviour, customer’s power, customer’s technical and
commercial competence and the customer’s preference to do business with a
number of suppliers.
3. Competition for the account that is assessed by considering the number of
competitors, and the strengths and weaknesses of those competitors.
173
TRIVARIATE CPM MODEL
Peter Turnbull and Judy Zolkiewski have developed the three-dimensional CPM
framework. The dimensions they propose are cost-to-serve, net price and
relationship value.
174
OPERATIONAL CRM
OPERATIONAL CRM
175
OPERATIONAL CRM
Operational benefits are the first returns from IT-enabled CRM
programmes.
Customer-facing processes in selling, marketing and customer service
become more efficient as they are formalized and standardized and
generate operational cost savings.
It is important to realize that an organization’s CRM strategy options are
limited by its operational capabilities.
The SVOC integrates data from all operational units that touch customers,
including sales, marketing, customer service and accounts, to create a
coherent picture of the customer’s interactions with the business.
Once the SVOC is created CRM users can interact with customers on a one-
to-one basis, in full knowledge of their history with the business, thereby
enhancing customer experience throughout the customer’s relationship
with the firm. 176
OPERATIONAL CRM
Appropriate customer management actions can only be taken if the insight
is delivered to the customer-facing employees who use the firm’s selling,
marketing and service operational processes.
178
SALES FORCE AUTOMATION
Sales Force Automation (SFA) is when parts of the sales
process are automated by software tools.
The automation usually focuses on repetitive, administrative
tasks that, while important, can be time-consuming for sales
teams to perform.
The SFA software will usually automate tasks based on certain inputs.
180
PURPOSE OF SALES FORCE AUTOMATION
183
SFA ECO-SYSTEM
The SFA eco-system is made up of three components:
SFA SOLUTIONS PROVIDERS
HARDWARE AND INFRASTRUCTURE VENDORS
ASSOCIATED SERVICE PROVIDERS
SFA solutions providers can be classified in a number of ways. Some are SFA
specialists. They compete against enterprise and mid-market CRM suites that
include SFA modules, and enterprise suite vendors that offer a full range of IT
solutions to support business, including supply chain management (SCM) and
customer relationship management (CRM)
184
SFA ECO-SYSTEM
185
SFA ECO-SYSTEM
ACCESSIBILITY
SFA solutions, like other CRM technologies, are accessed in
one of two ways.
186
SFA ECO-SYSTEM
SERVICES – TRAINING/LEARNING & USABILITY
When a SFA project is undertaken, service costs may add significantly to
overall project expenditure.
187
SFA ECO-SYSTEM
HARDWARE & INFRASTRUCTURE
The performance requirements of SFA applications can create significant
challenges for both hardware and technology infrastructure.
Whereas office-bound salespeople and sales managers might be happy to
use desktops or laptops, field sales staff mostly prefer to use mobile data
devices: smart phones or tablets.
Where companies have geographically dispersed external salespeople,
SFA systems have to operate 24/7 in real time, allowing organizations to
manage opportunities as quickly as possible.
SFA applications often need to integrate with back-office systems so that
field sales has visibility of outstanding service issues or order progress
in advance of a client meeting.
188
SFA ECO-SYSTEM
190
BENEFITS OFFERED BY SFA
For shorter sales cycles leading
higher win rates
Salespeople to faster inventory turnover
improved customer
reduced cost-of-sales
relationships
192
HOW SFA CHANGES SALES PERFORMANCE
There have been a number of independent assessments of the effects of SFA on
sales performance.
193
CONDITIONS TO DERIVE SF BENEFITS
Salespeople find that the SFA application is easy to use.
Salespeople find the technology useful because it fits their roles well.
Availabilityofofappropriate-to-task
Availability appropriate-to-task SFA
SFAtraining.
training.
Users
Users have
have accurateexpectations
accurate expectations about
aboutwhat
whatSFA
SFAwill
willdeliver.
deliver.
Users
Users have
have a apositive
positiveattitude
attitude towards
towardsinnovation.
innovation.
Users
Users havea apositive
have positiveattitude
attitude towards
towardstechnology
technology
Availability
Availability of of usersupport
user support after
after roll-out,
roll-out,for example,
for a help
example, desk.
a help desk.
Involvement
Involvementof user groups
of user including
groups sales reps
including and
sales managers
reps during SFAduring
and managers project
planning
SFA project and technology
planning selection.
and technology selection.
Deployment of a multidisciplinary team in the SFA project planning
phases.
Senior management support for SFA. 194
MARKETING AUTOMATION
Marketing automation is the application of computerized
technologies to support marketers and marketing
management in the achievement of their work-related
objectives.
195
Caselet
196
WHAT MARKETING AUTOMATION DOES ?
Personalized Workflows
Prospects' actions are added data point for marketing strategy, telling you what
customers are looking for, immediately in the moment but manually tracking these
behaviours is impossible. With MA, businesses can use these inputs across multiple
channels to deeply understand their customers’ needs and deliver the right content at the
right time.
Streamlined Processes
Organisations can build streamlined processes that keep customers at the
center of it all.. Break through silos and work together to provide a unified
customer experience right from the very first touch, all the way beyond the
customer purchase.
Improved marketing
Enhanced responsiveness
intelligence
199
CAMPAIGN MANAGEMENT
A digital marketing campaign involves the execution of a
marketing strategy across all the digital channels where
consumers engage with a brand, usually for the purpose of
improving a company's conversion rate.
Companies can use a digital campaign for a variety of uses, from raising
brand awareness to telling loyal customers about a new product. 200
CAMPAIGN MANAGEMENT
CONVERSION
VALUE
CREATION
CONSIDERATION
DISCOVERY
UNAWARENESS
201
ELEMENTS OF CAMPAIGN MANAGEMENT
Workflow
Personalization
Execution
Measurement
Modelling
Reporting
202
ELEMENTS OF CAMPAIGN MANAGEMENT
203
ELEMENTS OF CAMPAIGN MANAGEMENT
204
ELEMENTS OF CAMPAIGN MANAGEMENT
205
ELEMENTS OF CAMPAIGN MANAGEMENT
206
Caselet
207
Snapshot
208
E-MAIL MARKETING CAMPAIGN
209
E-MAIL MARKETING CAMPAIGN
Functions
Allows firms to keep customers informed, and to customize their marketing
messages accordingly.
Most cost-effective and conversion-rich forms of digital marketing.
Potent & Persuasive
Drip Marketing
Drip Marketing is a communication strategy that sends, or “drips”
a pre-written set of messages to customers or prospects over time.
Drip Marketing is all about giving people the right information at the right time.
If someone just
Or if a potential customer has
subscribed to your
been hovering around your
blog newsletter
"premium upgrade" page for a
few weeks
Send a welcome
DAY 1 DAY 7
email right away
email the customer five reasons
to purchase the premium plan.
an email that shows
DAY 3 some of your most-
read content
When to Use Drip Marketing
Nurturing Leads
Welcoming
Onboarding
Abandoned Shopping Carts
Recommendations
Confirmations
Engagement
When to Use Drip Marketing
Nurturing Leads
When to Use Drip Marketing
Welcoming
When to Use Drip Marketing
Onboarding
When to Use Drip Marketing
Recommendations
When to Use Drip Marketing
Confirmations
When to Use Drip Marketing
Engagement
Event Based Marketing
Event based marketing (also called trigger marketing and event initiated
marketing) is a form of marketing that identifies key events in the customer
and business lifecycle.
The number of triggers or events that an organisation uses might range form
just a few to several hundred.
Event Based Marketing
There are two components: managing identity and recording behaviour.
Event Based Marketing
Identity
When a user visits a website or mobile app they are automatically assigned an
anonymous identity.
The anonymous identity is used to store the record of their behaviour until, and
if, the user becomes ‘identified’.
Identified users are known users who already have a record in the user database.
At this point, the anonymous identity and the known identity are joined
together so that all past behaviour recorded against the anonymous user is now
stored directly against the known user.
Without a user’s identity we would not be able to assign the stored behaviour to
a particular person.
This would limit our ability to communicate with the user (we can’t send them an
email or push notification if we don’t know who they are).
Event Based Marketing
Behaviour
Behaviour is information that describes how the user interacts with the website or
app. It is recorded as an ‘event’.
An event is a single instance of measured behaviour; a single event in the journey
of the customer. The
The event could describe a users explicit action such as ‘Clicked on Playlist’ or an
implicit action such as ‘Moused Over Playlist’.
This approach helps us send the user a much more contextual message or prompt when
trying to engage them.
Event Based Marketing
Marketing Optimization
Marketing Optimization
Customer Service & Delight
Focuses on providing a positive customer experience both
at the point of sale and after the sale in order to drive profit
and gain competitive advantage.
Customer Service & Delight
If we rely on self-service technology, excellent service is experienced when the
technology works as expected – for example, the bank’s automatic tellers are
operational, and the website provides all necessary help and information in a
couple of clicks.
Outcome
Situational focused &
and reactive intentional
6 7 8 9
Customer Focus via Service Quality
Tangibility
Reliability
Responsiveness
Assurance
Empathy
Service Quality Parameters
Appearance of physical
Appearance of Physical Facilities
properties, equipment,
Appearance of Service Personnel
Tangibility personnel, and
Appearance of Tools/ Equipments
communication materials
used for Service
Their operations run smoothly with minimal product and service defect rates,
allowing them to focus on pleasing customers.
Customer service lies at the heart of the value proposition. Customer service
is the main selling point.
They employ the latest technologies that allow their customers to interact
with them more conveniently, help them develop a profound understanding
of what customers need and want, and enable them to track activities and
processes that influence customer experience.
Customer Service Excellence
The Customer Service Excellence® standard has been developed by the UK
government with a view to providing guidance to public and private sector
organizations that want to make a significant difference to the quality of their
customer service. The standard identifies five criteria that need to be satisfied
for excellent customer service to be delivered.
Service Automation – in its very essence – is the delivery of a service, but than
completely automated manner.
Key examples of companies who became very successful with Service Automation
are Uber and Netflix.
They took a traditional service (getting from A to B or watching a TV series), and
completely automated every step of that service experience. From selection,
booking and ordering, to automated payments and automated customer services.
The primary interface for their users is a single app, and every other step off their
service is completely automated.
SERVICE AUTOMATION
CONTACT CENTRES
CALL CENTRES
HELP DESKS
FIELD SERVICE
BENEFITS OF SERVICE AUTOMATION
Enhanced Service Effectiveness
Service requests can be completed more quickly to the customer’s
satisfaction by ensuring that requests are handled at the first point of
contact or routed to the right service engineer or customer service agent,
who is able to draw on an up-to-date knowledge base to resolve the issue.
Agents have full visibility into the customer history and service requests
and can therefore ensure that service delivery is appropriate to customer
status or agreed service levels, and satisfies the customer.
Agent Management
Is a high priority for call and contact centre managers. Managers want to
employ the lowest head-count compatible with the desired level of
customer service. Too few agents and customers will be dissatisfied with
wait-times; too many agents and payroll costs will be unnecessarily high.
Customers and managers both want issues to be resolved quickly by
agents. A large number of key performance indicators are used in call
and contact centre environments such as : CALL VOLUMES RECIEVED,
AVG QUEUING TIME, AHT, ATT, ABANDON RATE, FTR.
Functionality offered by Service Automation Software
Case Assignment
It ensures that each enquiry or issue gets routed to the right agent or
technician for resolution. Customer service agents might, for example, be
organized according to language skills. When an email enquiry is
received in Urdu it is assigned to the agent competent in that language.
Field technicians might be organized according to product category.
Case Management
It covers the full cycle of activities involved, from receiving initial
notification of a matter of concern to a customer to its final resolution
and the case file being closed. Case management is also known as
incident management and issue management. Case management
applications enable case handlers to manage simple incidents, customer
complaints and complex cases and investigations.
Screen Shots
Functionality offered by Service Automation Software
Contract Management
The functionality enables service engineers and managers to create,
track, progress, accelerate, monitor and control service contracts with
customers. Contract management software offers a range of
functionalities: document management, contract authoring, workflow,
email or SMS alerts (about contract expiry, for example).
https://youtu.be/NrmMk1Myrxc
Scheduling
Scheduling involves planning and organizing a service technician’s
activity plan for a day, week or other period.
A technician’s schedule contains details on the customer, location, time,
product and issue. Some scheduling applications take into account a
range of considerations to ensure that the right technician is sent to
service the customer.
Analytical CRM
WHAT ?
It is a subset of CRM in which a company collects data about its customer
interactions, to increase customer satisfaction and customer retention
rates.
WHY ?
Companies may forecast consumer behaviour and recommend goods to
which they are more likely to respond better based on the information
collected about customer behaviours, experiences, and the end effects of
these experiences.
Analytical CRM
Analytical CRM is an essential part of managing customer relations. It
accumulates and analyzes consumer data of various kinds, including:
Data Mining - Analytical CRMs use Data Mining techniques to map consumer-
related information and data trends, as we mentioned above. This provides a
more in-depth insight into a company's consumer journey: a cycle that involves
customer recognition, interest, retention, and growth.
Key Features of Analytical CRM
Knowledge of what motivates prospects to become customers
When you combine demographic details of prospects with a database of their
preferences and marketing experiences, you will start to get an idea of what
motivates them to become customers.
Data that are for customers include data about products and solutions to
service issues. These data are typically stored in a searchable knowledge base
and made available to customers and partners through portals.
Data about customers are available from third parties such as market research
firms and credit scoring agencies, and increasingly in social media such as
Facebook, Twitter and YouTube
Corporate Customer Related Data
Companies typically do not have just one customer database. Instead, they have
a number of customer-related databases. These databases capture customer-
related data from a number of different functional perspectives, such as :
Sales
opportunities,
Marketing campaigns,
Record
Customer enquiries,
Services Data, such as : deliveries and
billing.
Understanding why people connect with your brand the way they do.
Showing which digital platforms they make the most use of.
Highlighting specific pain points, challenges, and problems common among
your customers.
The Role for a Strong Customer Journey
Relational databases are now the standard architecture for CRM applications
that use structured data.
This question means that the business has to revisit to the CRM vision,
strategy, goals, objectives and business case, to identify what is expected
from CRM.
The social groups are based on urbanization and socio-economic rank, and the
life-stage groups on age, socio-economic rank and the presence of children at
home.
Example
Example
If you were a retailer considering diversifying from leisurewear into dancewear
and had little relevant customer data of your own, you might be interested in
buying or renting a compiled list from an external source. The list could be
compiled from a variety of sources, such as:
Data Duplication
De-duplication can be run as an inline process as the data is being written into the
storage system and/or as a background process to eliminate duplicates after the
data is written to system.
Populate the Database
Maintaining the Database
Customer-related databases need to be updated to keep them useful. Consider
these statistics:
One in five managing directors change jobs in any year.
Some 8% of businesses relocate in any year.
In the UK, 5% of postcodes change in an average year.
In Western economies about 1.2% of the population dies each year.
In the USA, over 40 million people change addresses each year.
S Data need to be shareable because several users may require access to the
same data at the same time.
T Timely data are data that are available as and when needed.
A legacy system is outdated computing software or hardware that is still in use, but its older
technology won't allow it to interact with newer systems.
Data Integration
In most companies there are several customer-related databases,
maintained by different functions or channels.
Companies often face the challenge of integrating data from several sources
into a coherent single view of the customer.
These data sets are so voluminous that traditional data processing software
just can't manage them.
But these massive volumes of data can be used to address business problems
you wouldn't have been able to tackle before.
THE 3V’S OF BIG DATA
https://blog.hurree.co/blog/explain-the-3-vs-of-big-data
THE POWER OF BIG DATA
BIG DATA & CRM
BIG DATA & CRM
MANAGING
Managing the customer with structured data such as an address, contact
information and latest contact moments is only one part.
Managing the customer is primarily an inside-out approach where the
company ‘manages’ the customer by sending messages and storing basic
information about the customer.
In order to do that it uses predefined channels at set business hours.
This company-defined process lacks flexibility.
Nonetheless, it is important to have as it is the basis for understanding
your customer.
BIG DATA & CRM
INTERACTING
Interacting with the customer with unstructured data such as emails,
tweets, Facebook posts, comments etc.
Interacting is customer-driven or outside-in.
There is a two-way communication process and the customer decides
when to have contact with the organisation and he/she expects to be
responded to fast, also outside business hours.
Everyone in the company should be involved and it involves customer-
driven channels such as social networks or communities.
BIG DATA & CRM
ANALYSING
Analyzing the customers’ actions with structured data such as online
visits, click-throughs, bounce rates etc. is a company driven process,
primarily done by analysts.
These analysts generally perform an action when asked for insight or
deliver standardized reports to marketers on a regular basis.
With Big Data techniques involved, the role of the analyst will
significantly change as he/she will be required to more proactively deliver
results on a more regular, preferably real-time, basis.
BIG DATA & CRM
KNOWING
Knowing the customer is where it really gets interesting.
Big data engineers a mixed data approach to perform analyses that
allow the organisation to understand each customer individually on
a real-time basis.
They can provide predictive recommendations in order to
develop/deliver the right product, for the right price, at the right
price and through the right channel.
The result will be an increased conversion rate.
SENTIMENT ANALYSIS
WHAT ?
Sentiment analysis, also referred to as opinion mining, is an approach to
natural language processing (NLP) that identifies the emotional tone of text.
It involves the use of data mining, machine learning (ML) and artificial
intelligence (AI) to mine text for sentiment and subjective information.
WHY ?
Sentiment analysis systems help organizations gather insights from
unorganized and unstructured text that comes from online sources such as
emails, blog posts, support tickets, web chats, social media channels, forums
and comments.
TYPES OF SENTIMENT ANALYSIS
FINE-GRAINED SENTIMENT ANALYSIS provides a more precise level of
polarity by breaking it down into further categories, usually very positive to very
negative. This can be considered the opinion equivalent of ratings on a 5-star
scale.
TELECOM
Expanding and growing at a fast pace, especially with the advent of the
internet. Data mining can enable key industry players to improve their service
quality to stay ahead in the game.
INTRUSTION DETECTION
Network resources can face threats and actions that intrude on their
confidentiality or integrity. Therefore, detection of intrusion has emerged as a
crucial data mining practice.
https://www.fireeye.com/cyber-map/threat-map.html
APPLICATION OF DATA MINING
RETAIL INDUSTRY
The retail sector holds sizable quantities of data points of sales, purchasing history,
delivery of goods, consumption, and customer service. The databases have become
even larger with the arrival of e-commerce marketplaces.
Multidimensional data analysis analyses different types of customers, products,
regions, and time zones. Online retailers can also recommend products to drive
more sales revenue and analyze the effectiveness of their promotional campaigns.
EDUCATION
Institutions can use data mining to predict which students would enrol in a
particular program, who would require additional assistance to graduate, refining
enrolment management overall.
ENERGY INDUSTRY
Big Data is available even in the energy sector nowadays, which points to the need
for appropriate data mining techniques. Data mining can also achieve productive
gains by predicting power outputs and the clearing price of electricity.
How Data Analytics is Solving Murders
One of the primary advantages of big data analytics software is that it can
evaluate huge quantities of data much faster than humans can, plus spot
trends they’d likely miss. So, from a crime-solving point of view, data
analytics could help catch criminals who are trying to evade arrest.
A Denver police chief who’s in favour of using the technology mentioned 70%
of all crimes committed involve vehicles.
Police in India are among those using data analytics. They incorporate
criminal behaviour patterns, crime anniversaries, parole dates and conditions
and more as they rely on data to help them detect useful patterns that could
keep people safer.
Decision tree is the most powerful and popular tool for classification and
prediction.
The decision tree algorithm progressively partitions the dataset into groups
according to a decision rule that aims to maximize homogeneity or purity of
the response variable in each of the obtained groups.
DATA MINING PROCEDURES
DATA MINING PROCEDURES
LOGISTIC REGRESSION
It measures the influence of one or more independent variables that are
usually continuous on a categorical dependent variable.
Other brands
ETHICS IN CRM
PRIVACY AND CONFIDENTIALITY
Privacy and confidentiality are at the heart of many ethical issues related to
CRM. Companies have a responsibility to collect their information from
legitimate sources without violating the privacy of the customer. In some
cases, sensitive data may be gathered, including credit card or bank details.
In these cases, the company must protect this information; poor data
security or sloppy procedures could result in harm to the customers that
CRM is intended to benefit.
CUSTOMER PARTICIPATION
MIS-SELLING
DISINTERMEDIATION
Disintermediation refers to the removal of intermediaries such as broadcast
and print media from the company’s communication channels with
customers. Today, new technologies have led to the emergence of many
direct-to-customer (DTC) communication tools including email, direct mail,
and SMS and MMS messaging to cell phones. Companies are now able to get
their message direct to customers. Equally, customers can get their
messages direct to companies, and to other customers in the ways described
above.
CREATING CUSTOMER VALUE
There are many benefits to your brand from embracing the direct-to-
consumer model:
PERSONALISATION
High-quality customer-related data, CRM technologies and DTC channels in
combination enable companies to tailor offers and communications to
individual customers.
CRM technologies used in call and contact centres allow for personalized
interactions between customers and customer service agents.
CREATING CUSTOMER VALUE
INTERACTIVITY
Interactive technologies have been around since the advent of the telephone.
However, the Internet has revolutionized the scope for interactivity through
three major technologies: email, instant messaging and the World Wide Web
(WWW).
https://www.cleverism.com/mass-customization-what-why-how/
https://hbr.org/1997/01/the-four-faces-of-mass-customization
APPROACHED TO MASS CUSTOMISATION
https://www.youtube.com/watch?v=9DE3DzoMSGg
KNOWLEDGE MANAGEMENT FOR CRM
Creating and sharing information is an important part of any organization
or a business.
But organizing customer data and making the same data easily accessible
and available to employees for further use can be a time-consuming task.
Knowledge
Management
systems are
software
WHAT IS KNOWLEDGE MANAGEMENT?
1. Close rate
2. Up-sell rate
3. Net-new revenue
4. Length of each sales pipeline stage
5. Length of sales cycle
6. Customer lifetime value (CLV)
7. Customer acquisition cost (CAC)
8. Revenue generated by campaign
9. Email list growth rate
10. Net promoter score (NPS)
11. Churn rate
12. Average time to resolution
13. Average number of follow-ups per ticket
MEASURING SUCCESS OF CRM
Close Rate
Every sales team uses close rate as a measure of success — but close rate
alone doesn’t always tell the whole story. For Example...
1. Business 1 closes 75% of their deals.
2. Business 2 only closes 5% of their deals… but makes more money.
How?
CRM can help increase the upsell rate by helping to predict which
leads are most likely to upgrade or buy other products.
MEASURING SUCCESS OF CRM
Net-New Revenue
Let’s say leads stay in the proposal creation step 10x longer than any
other step. As creating proposals takes time, but how can firm's help the
sales team move these leads to the next step more quickly?
The more effective your CRM system, the faster deals move through
each stage of your pipeline.
MEASURING SUCCESS OF CRM
Length of Sales Cycle
For Example...If a lead’s first conversation with the sales team is in early
January, and they make a purchase or sign a contract in early July, the
sales cycle is about six months long.
The more people involved in the decision to purchase, the longer it will
take to close. Same goes for price: the more expensive the product or
service, the longer the sales cycle.
With CRM, we can analyse the phases in the sales process and co-
ordinate the shorten the sales cycle.
MEASURING SUCCESS OF CRM
Customer lifetime value (CLTV)
Fact: Every single marketing team wants to decrease CAC. Closing more deals while
spending less money?
Effective CRM helps you lower your CAC by:
1. Targeting more qualified leads
2. Automating sales and marketing tasks
When you target more qualified leads, you close more deals. Automation makes
your marketing team more efficient, which saves you time and money.
Combine the two? Your CAC will drop.
MEASURING SUCCESS OF CRM
Email List Growth Rate
This metric measures how much your email list grows over a certain
time period.
Say you have 500 new subscribers and 50 unsubscribes. Your list has 5,000
contacts total. Here’s the math:
500 new subscribers – 50 unsubscribes = 450
450 / 5,000 = 0.09
0.09 x 100 = 9% email list growth rate